Nav Canada, Iridium Sign Aireon Joint Venture Agreement

Former Iridium executive Don Thoma is president and CEO of the recently formed Aireon joint venture with Nav Canada. (Photo: Aireon)

Canadian air navigation service provider (ANSP) Nav Canada and Iridium Communications signed a joint venture agreement that will eventually give Nav Canada a controlling interest in the Aireon global, satellite-based aircraft surveillance system.

Under the terms of the agreement announced on November 19, Nav Canada will invest $150 million in five tranches, with the final tranche payment scheduled for late 2017, to acquire a 51-percent interest in Aireon. At present, Aireon is a wholly owned subsidiary of Iridium, co-located with the satellite communications company in McLean, Va. Iridium will retain a 49-percent ownership stake in the joint venture company.

Aireon plans to provide subscribing ANSPs with aircraft position reports over oceanic and remote regions of the Earth, beyond the coverage of radar, using automatic dependent surveillance-broadcast (ADS-B) payloads on the Iridium Next constellation of 66 satellites. The new satellites are scheduled to be launched into low-earth orbit between 2015 and 2017. Aireon will pay Iridium $200 million in one-time hosting fees, which the company expects to raise through additional equity investors and debt, or borrowing, based on long-term customer service contracts, said president and CEO Don Thoma.

In an interview with AIN, Thoma said Aireon is in discussions with other ANSPs, but he declined to identify them. “You can imagine where there are large swaths of ocean that need to be controlled, those are the organizations that would have an interest in this capability,” he said. In addition to having an ownership stake, Nav Canada will be Aireon’s launch customer. The private, non-share corporation will use the system to track aircraft over the North Atlantic, the world’s busiest oceanic airspace.

Thoma said the U.S.FAA is “actively engaged with us in evaluating the capability.” The Aireon system will complement, rather than compete against, the FAA’s own ADS-B surveillance network of 794 ground radio stations, he said. The latter network will be fully deployed by prime contractor ITT Exelis by the end of next year. “In the dense [air traffic] areas and especially in terminal areas around airports, there’s always going to be a need for ground-based ADS-B receivers to handle the amount of traffic that accumulates in a small region, but also for reliability and safety reasons. Aircraft fly a lot closer together near airports than they do over the oceans,” Thoma observed.